Additional Resources for Veterans Interest Rate Reduction for Low- Income Borrowers Income Limits

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1 Revised August 23, 2013

2 Table of Contents SINGLE- FAMILY LOANS GENERAL REQUIREMENTS... 1 SINGLE- FAMILY LOANS PURPOSE... 2 SINGLE- FAMILY LOAN LIMITS... 3 SINGLE- FAMILY LOAN PROGRAMS STATEWIDE... 4 Closing Cost Assistance Program, CCAP... 4 Taxable Program... 5 Tax- Exempt First- Time Homebuyer Program... 5 Tax- Exempt Program Non- Targeted Areas/Income Limits Tax- Exempt Program Income Limits Targeted Areas/Income Limits Tax- Exempt Program (TEP) First- Time Homebuyer Acquisition Cost Limits Gross Monthly Income Worksheet The Facts About Federal Recapture Tax Taxable First- Time Homebuyer Program Veterans Mortgage Program Additional Resources for Veterans Manufactured Home Financing Non- Conforming I Program Non- Conforming II Program Second Mortgage Program for Energy Conservation Second Mortgage Program Taxable & Rural Owner- Occupied Purchase Renovation SINGLE- FAMILY LOAN PROGRAMS RURAL Rural Owner- Occupied Loan Program Rural Non- Owner- Occupied Loan Program Rural Small Building Material Loan LOAN OPTIONS Refinance Streamline Refinance Interest Rate Reduction for Low- Income Borrowers, IRRLIB Interest Rate Reduction for Low- Income Borrowers Income Limits Energy Efficiency Interest Rate Reduction, EEIRR Affordable Housing Enhanced Loan Program, AHELP... 23

3 State Veterans Interest Rate Preference, State Vet State Veterans Preference Income Limits MULTI- FAMILY LOAN PROGRAMS Assistance Provider Interest Rate Reduction Program Senior Housing Loan Program Multi- Family Congregate and Special Needs Program Multi- Family Loan Purchase Program Multi- Family Federally Insured Loan Program OTHER LOAN PROGRAMS Loans to Sponsors Association Loan Program Alaska Energy Efficiency Revolving Loan Program, AEERLP AHFC- APPROVED LENDERS Single- Family Lenders, 1 to 4 Units Closing Cost Assistance Program (CCAP) Multi- Family Loan Purchase Program Lenders, 5 or More Units Online Resources... 34

4 SINGLE- FAMILY LOANS GENERAL REQUIREMENTS These requirements apply to all Single-Family loans unless otherwise specified in individual program guidelines. Please consult an approved lender for details (see page 32). Eligible Borrowers: Must be credit-qualified residents of the state of Alaska. Must be current on child support payments (no past due). Must owner-occupy the purchased property within 60 days of loan closing. May have only one AHFC loan for owner-occupied property. Must also meet individual program guidelines. Eligible Properties: Single-family residences, condominiums, Common Interest Community units, Type I manufactured homes (permanently attached to a foundation), duplexes, triplexes or fourplexes. Not all properties are eligible for financing under all loan programs. Down Payment: Conventional loans (minimums). Single-family 5%. Duplex 10%. Triplex or Fourplex 20%. Requirements for federally insured or guaranteed loans (VA/FHA/HUD/USDA-RD) are determined by the insurer or guarantor. Loan Term: Fixed Interest Rate for up to 30 years. Loan term may be adjusted for property type or remaining economic life. Assumptions: Qualified borrowers may assume AHFC Single-Family loans unless otherwise noted. Assumptions are subject to individual program guidelines. Single-Family Loans General Requirements 1

5 SINGLE- FAMILY LOANS PURPOSE AHFC borrowers may use a Single- Family loan to: Purchase an existing or newly-constructed residence. Obtain long-term financing for the construction of a new home (owner/builder or deed-to-builder transactions). Purchase a home and obtain funds for renovation: Renovations must improve the living conditions of the home. Luxury items (sauna, Jacuzzi, etc.) may be included if they are a portion of the renovation cost. Maximum loan amount is based on the type of financing plus renovation cost. Maximum time to complete renovations is 180 days from the date of closing. Refinance a home: Refinance an existing AHFC loan using the Streamline Refinance option and lower the interest rate without a new appraisal or credit check. Refinance to improve the terms on an existing AHFC loan and/or obtain funds for home improvements. Refinance a non-ahfc loan to improve the terms on the existing loan and/or obtain funds for renovation or home improvement. Obtain a Second Mortgage: To assist in purchasing a home when also assuming an AHFC loan or to renovate an existing home. To finance energy improvements through the Second Mortgage Program for Energy Conservation. Renovate a home located in a very small community through the Rural Small Building Material Loan Program. Loans are offered for single-family homes through fourplex properties for the owner (restrictions may apply). Refinances and second mortgages are also offered. Single-Family Loans Purpose 2

6 SINGLE- FAMILY LOAN LIMITS Listed are the current loan limits for AHFC s Single-Family Loan Programs. Updates are immediately available on our website at Current as of July 1, 2013 (Effective Jan. 1, 2009) Program Financing Single- Family Duplex Triplex Fourplex Taxable Conventional VA FHA/HUD/RD $688,050 $688,050 $800,775 $800,775 $967,950 $967,950 $1,202,925 $1,202,925 Taxable First-Time Homebuyer Conventional VA FHA/HUD/RD $688,050 $688,050 $800,775 $800,775 N/A N/A Tax-Exempt First-Time Homebuyer Conventional VA FHA/RD Acquisition Cost Limits 2 Acquisition Cost Limits 2 N/A N/A Veterans Mortgage Program Conventional VA FHA/HUD/RD $688,050 $688,050 $800,775 $800,775 $967,950 $967,950 $1,202,925 $1,202,925 Rural Owner-Occupied Conventional VA FHA/HUD/RD $625,500 $625,500 $800,775 $800,775 $967,950 $967,950 $1,202,925 $1,202,925 Rural Non-Owner- Occupied Conventional HUD184 N/A N/A $800,775 $967,950 $1,202,925 Non-Conforming I Conventional Only $688,050 $800,775 N/A N/A Non-Conforming II Conventional VA FHA/HUD/RD $688,050 $688,050 $800,775 $800,775 $967,950 $967,950 $1,202,925 $1,202,925 Notes: 1 For FHA/HUD184 limits, go to: select Alaska, then click send. HUD184 limits are listed at the bottom of the FHA Mortgage Limits list. 2 For Tax-Exempt Acquisition Cost Limits, go to Maximum VA guaranty is available at $625,500. A down payment is required on loan amounts over $625,500. 3

7 SINGLE- FAMILY LOAN PROGRAMS STATEWIDE Closing Cost Assistance Program (CCAP). Taxable. Tax-Exempt First-Time Homebuyer. Rural Owner-Occupied. Rural Non-Owner-Occupied. Taxable First-Time Homebuyer. Rural Small Building Material. Veterans Mortgage Program. Non-Conforming (two programs). Second Mortgage (three options). Closing Cost Assistance Program, CCAP The borrower will receive 4% of the initial principal balance of the mortgage loan. Example: On a $200,000 mortgage, the assistance equals $8,000. This assistance can be used for closing costs, minimum cash investment and principal reduction and must be applied to closing costs first. The closing cost assistance is funded directly by AHFC at the time of closing. The assistance is not added to the loan and no repayment of the assistance is required. Eligible Loans: 30 years fixed rate. FHA, VA or USDA-RD. Purchase transactions only no refinance. Eligible Property Type: A one-unit, single-family dwelling, including condominiums and Type I manufactured housing. Eligible Borrowers: Alaska residents. No back child support (UND-22). Minimum credit score 640. Satisfactory home inspection. Contractor licensing. Construction inspections. Alaska Building Energy Efficiency Standards (BEES). Contact an AHFC-approved CCAP lender (see page 33). 4

8 Taxable Program Borrowers and properties must meet AHFC s general financing requirements. There are no program-specific criteria. Loan Options: Affordable Housing Enhanced Loan Program. Energy Efficiency Interest Rate Reduction. Interest Rate Reduction for Low-Income Borrowers. State Veterans Preference. Refinance. Streamline Refinance. Second Mortgage. Contact an AHFC-approved lender (see page 32). Tax- Exempt First- Time Homebuyer Program To be eligible for the Tax-Exempt First-Time Homebuyer Program, borrowers may not have owned a primary residence in the last three years except as noted below. Federal regulations establish maximum income limits and acquisition costs for this program. Income is determined by multiplying the borrower's gross monthly income by 12. Acquisition cost is the total cost of acquiring the property from the seller. Prior homeownership requirements do not apply to targeted areas or to qualified veterans. Targeted areas (HUD-designated census tracts) have higher income and acquisition cost limits. To find out if a property is located in a targeted area census tract, go to Factfinder and perform a street address search under Census Qualified veterans must have been retired, discharged, or released from duty under conditions other than dishonorable, and active duty military borrowers must have completed their initial military obligation. Acceptable evidence of eligibility includes a copy of the veteran's Certificate of Eligibility or Title 38 letter and a DD-214 or Statement of Service. No previous use of the TEP or Veterans Mortgage Program is allowed under the veterans exception. Eligible properties are limited to single-family homes, condominiums, Common Interest Community units, duplexes and Type I manufactured homes. A duplex must be at least five years old and occupied as a multi-family residence for at least the last five years. Borrowers must submit copies of federal income tax returns for the last three years. Borrowers who obtain a TEP loan may have to pay federal "recapture" tax following the sale of their home. AHFC recommends consulting a tax professional to determine if the recapture penalty applies. For more information, refer to The Facts about Federal Recapture Tax on page 11. 5

9 Forms: Borrowers are required to read the Tax-Exempt Booklet located at and to complete the Applicant's Affidavit found in the back of the booklet. Sellers must complete and sign a Seller's Affidavit also found in the back of the Tax-Exempt Booklet. Loan Options: Affordable Housing Enhanced Loan Program. Energy Efficiency Interest Rate Reduction. Interest Rate Reduction for Low-Income Borrowers. State Veterans Preference. Streamline Refinance. Contact an AHFC-approved lender (see page 32). 6

10 Tax- Exempt Program Non- Targeted Areas/Income Limits 2013 Effective 10/01/2013 Area 1-2 Person 3 or More Anchorage* $87,800 $100,970 Mat-Su* $87,632 $100,777 Aleutians West* $92,949 $106,891 Bethel Census Area $82,900 $95,335 Bristol Bay Borough $83,200 $95,680 Denali Borough $93,000 $106,950 Dillingham* $82,676 $95,077 Fairbanks $81,800 $94,070 Juneau City and Borough* $98,030 $112,734 Kenai Peninsula Borough $81,800 $94,070 Ketchikan Gateway Borough* $81,900 $94,185 Kodiak Island Borough* $85,665 $98,515 North Slope Borough* $81,800 $94,070 Petersburg Census Area $81,800 $94,070 Sitka City and Borough* $90,360 $105,420 Skagway Municipality $83,000 $95,450 Valdez-Cordova Census Area $81,800 $94,070 Yakutat City* $99,600 $116,200 All Other Areas $81,800 $94,070 * High-Cost Housing Area an upward income adjustment for areas where housing costs exceed income by a ratio greater than the national level. 7

11 Tax- Exempt Program Income Limits Targeted Areas/Income Limits 2013 Effective 10/01/2013 Area Census Tract 1-2 Person 3 or More Anchorage 6 10 $105,360 $122,920 Fairbanks $98,160 $114,520 Bethel Census Area 1 3 $99,480 $116,060 Kenai Peninsula Borough 1 $98,160 $114,520 Hoonah Angoon Census Area 2 $98,160 $114,520 Skagway Municipality 2 $99,600 $116,200 Wade Hampton Census Area 1 $98,160 $114,520 Yukon Koyukuk Census Area 1 4 $98,160 $114,520 8

12 Tax- Exempt Program (TEP) First- Time Homebuyer Acquisition Cost Limits 2013 Effective 08/13/2013 Non- Targeted Areas New or Existing Single- Family Existing Duplex Anchorage $ 328,015 $ 419,907 Mat-Su Borough $ 328,015 $ 419,907 Aleutians West $ 350,307 $ 448,430 Bristol Bay $ 270,692 $ 346,523 Denali Borough $ 291,923 $ 373,707 Dillingham Census Area $ 306,923 $ 392,907 Fairbanks North Star Borough $ 291,923 $ 373,707 Haines $ 262,199 $ 335,630 Juneau City & Borough $ 368,076 $ 471,184 Ketchikan City & Borough $ 297,230 $ 380,492 Kodiak Island Borough $ 316,338 $ 404,954 Nome $ 253,707 $ 324,784 North Slope Borough $ 301,476 $ 385,938 Petersburg Census Area $ 301,476 $ 385,938 Sitka City & Borough $ 398,077 $ 509,584 Valdez-Cordova $ 266,445 $ 341,076 Yakutat City & Borough $ 381,092 $ 487,845 All Other Areas $ 250,200 $ 320,307 Targeted Areas New or Existing Single- Family Existing Duplex Anchorage $ 400,908 $ 513,220 Fairbanks North Star Borough $ 356,794 $ 456,754 All Other Areas $ 305,800 $ 391,486 9

13 Tax- Exempt First- Time Homebuyer Gross Monthly Income Worksheet For AHFC income-restricted programs and add-on options, income is based on annualized gross income. Add the sum of all sources of gross income (prior to your employer making any deductions for taxes or other employee deductions). Please also contact an AHFC-approved lender to determine if you qualify. Income Source Borrower #1 Borrower #2 Salary/Wage Overtime Bonuses Tips/Commissions Part-Time Employment Pension/Retirement VA Benefits Unemployment Compensation Social Security Public Assistance Alimony/Child Support Alaska Permanent Fund Longevity Bonus Dividends/Interest Net Rental Income Trust/Royalties Business/Investment Income Other Gross Monthly Income Gross Monthly Income Borrower #1 = Gross Monthly Income Borrower #2 = Total Gross Monthly Income = (Sum of Borrower 1 and 2) x12 Annualized Gross Income = 10

14 The Facts About Federal Recapture Tax Tax- Exempt First- Time Homebuyer Borrowers with Tax-Exempt loans may have to pay a recapture tax to the federal government following the sale of their home. This fact sheet is provided for informational purposes. AHFC recommends consulting a tax professional to determine if the recapture penalty applies. What is recapture? Recapture tax is paying back the federal government for the benefit of a lower interest mortgage loan. When tax-exempt mortgage bonds are used for financing, the borrower receives a benefit. When does recapture apply? Recapture applies when and if: The borrower sells the home within the first nine full years of ownership. The borrower realizes a capital gain on the sale of the home. The borrower s income increases above the federal allowable limits at the time of the sale. No recapture tax is due unless all three occur. How is the tax calculated? Borrowers calculate recapture tax using IRS Form For assistance, see also IRS Publication 523, Selling Your Home. What are the income limits and where are they found? A copy of the income limits for Alaska is provided at the closing of a Tax-Exempt loan. The income chart is attached to AHFC Form PRG-46, Notice of Recapture Requirement. The income limits are listed for each year of ownership in which the recapture tax may be due. When is recapture tax paid? Whether or not recapture tax is due, borrowers must file IRS Form 8828 with their federal income tax returns for the year in which their home is sold. For example, if a home is sold in 2006, IRS Form 8828 must be filed with the homeowner s 2006 income tax returns in Recapture tax is paid at the time income tax returns are filed. What happens if the loan is assumed? If the sale or transfer occurs before year 10 of homeownership, the original borrower pays any recapture tax that may be due and a new nine-year period begins for the assuming borrower. What happens when a borrower dies within the nine- year period? No recapture tax is due when a home is disposed of (sold) due to the death of the homeowner. Find out more with Sample Forms. Available in PDF at PRG-46, Notice of Recapture Non-Targeted Areas. PRG-46T, Notice of Recapture Targeted Areas. IRS Form IRS information/forms online at 11

15 Taxable First- Time Homebuyer Program This program is designed for first-time homebuyers wishing to purchase a home that exceeds the cost limits of the Tax-Exempt Program, or whose income exceeds Tax-Exempt Program income limits. ( First-time homebuyers have not owned a primary residence in the last three years.) Eligible properties include single-family residences, condominiums, Common Interest Community units, duplexes and Type I manufactured homes. A duplex may be newly constructed or existing. Borrowers must submit copies of federal income tax returns for the last three years. Forms: Borrowers must complete and sign the Applicant s Statement. Loan Options: Affordable Housing Enhanced Loan Program. Energy Efficiency Interest Rate Reduction. Interest Rate Reduction for Low-Income Borrowers. State Veterans Preference. Streamline Refinance. Contact an AHFC-approved lender (see page 32). Veterans Mortgage Program Qualified veterans may purchase or obtain long-term construction financing for owner-occupied single-family residences; and with certain restrictions, purchase a duplex, triplex or fourplex. A submission for AHFC financing must be received within 25 years of his/her date of discharge from active duty service. (Active duty service is full-time duty, other than for training.) Active duty service in the U.S. Armed Forces, U.S. Armed Forces Reserves, Public Health Service, NOAA, or service as a cadet at the U.S. Military, Air Force, Coast Guard or Naval Academy may meet requirements. Qualified veterans may be retired or active duty personnel. If retired, discharged or released from active duty, separation must have been under conditions other than dishonorable. Active duty personnel must have completed their initial military obligation and, at that time, must have been eligible for a separation under conditions other than dishonorable. A copy of the borrower s DD-214 and Certificate of Veterans Eligibility or Title 38 letter is used to determine eligibility. If there are two unmarried borrowers, both borrowers must be qualified veterans. Duplex, triplex and fourplex properties must be at least five years old and occupied as a multi-family residence for at least five years. Veterans may also qualify for the veteran s exemption under the Tax-Exempt First-Time Homebuyer Program. 12

16 Forms: Veteran borrowers must complete and sign an Information Certificate. Veteran borrowers must complete and sign a Mortgagor s Affidavit. The Mortgagor s Affidavit may not be signed by a Power of Attorney. Loan Options: Affordable Housing Enhanced Loan Program. Energy Efficiency Interest Rate Reduction. Interest Rate Reduction for Low-Income Borrowers. Streamline Refinance. Contact an AHFC-approved lender (see page 32). Additional Resources for Veterans Veterans may contact the following agencies for additional information about programs and benefits. Anchorage Area: Dept. of Veterans Affairs 1201 N. Muldoon Rd. Anchorage, Alaska Outside Anchorage: Fairbanks Veterans Center th Ave., Suite 100 Fairbanks, Alaska or Kenai Veterans Center Bldg. F, Suite 4, Red Diamond Ctr Kalifornsky Beach Rd. Soldotna, Alaska or Wasilla Veterans Center 851 E. West Point Dr., Suite 102 Wasilla, Alaska or

17 Manufactured Home Financing AHFC finances manufactured homes located in mobile home parks or on land (not on a permanent foundation), known as Type II manufactured homes. The maximum loan amount for Type II manufactured homes located on land (fee simple land) is $175,000. The maximum loan amount for all other Type II units is $100,000. New singlewide units may be financed for 10 years, existing units a maximum of seven years. New doublewide units may be financed for 14 years, existing units a maximum of 10 years. Type II manufactured home loans require a 15% down payment unless guaranteed by VA. Type II manufactured homes may only be financed under the Taxable Program. The value of the manufactured home is determined by an appraiser on the Manufactured Home Value Report. Contact an AHFC-approved lender (see page 32). Program Note: Financing for manufactured homes that are permanently attached to land (known as Type I manufactured homes) is available under most Single-Family Loan Programs. Non- Conforming I Program Conventional financing is available for certain properties with characteristics or features that limit the borrower s ability to obtain other financing. Non-conforming features include, but are not limited to, an unconventional foundation system, unconventional utilities, lack of central heating, or unconventional ceiling height. The home must be structurally sound and not pose health and/or safety hazards to the occupants. (AHFC may require reasonable repairs if the repairs eliminate the non-conforming feature and make the property eligible for other financing.) Non-conforming properties do not include those with limited marketability or those suffering from deferred maintenance, noncompliance with zoning, recreational properties or cabins. Limited to single-family residences, duplexes and Type I manufactured homes. Minimum down payment is 10%. Loan Options: Affordable Housing Enhanced Loan Program. Energy Efficiency Interest Rate Reduction. Interest Rate Reduction for Low-Income Borrowers. Refinance restrictions apply. Streamline Refinance. Contact an AHFC-approved lender (see page 32). 14

18 Non- Conforming II Program The Non-Conforming II Program provides financing for certain properties built after June 30, 1992, that may not have evidence of compliance with construction inspections and/or properties built after Dec. 31, 1991, that may not have evidence of compliance with thermal standards. The property must be existing and at least five years old at the time of submission for commitment. Existing single-family residences, condominium units, Common Interest Community units, duplexes, triplexes, fourplexes and Type I manufactured homes. The property must be at least five years old at the time of submission for commitment. Should the property exhibit any features of the Non-Conforming Type I, it is not eligible for financing under Non-Conforming Type II. A home inspection report conducted by a licensed home inspector is required. An energy rating equal to a minimum of 3 Stars is required. Loan Options: Affordable Housing Enhanced Loan Program. Energy Efficiency Interest Rate Reduction. Interest Rate Reduction for Low-Income Borrowers. Refinance. Streamline Refinance. Contact an AHFC-approved lender (see page 32). Second Mortgage Program for Energy Conservation AHFC provides financing to make cost-effective energy improvements on owner-occupied properties. Borrowers select from the list of energy upgrades included with the energy audit of their home, performed by an AkWarm TM certified energy rater. All improvements must be completed within 365 days of loan closing. (Improvements not listed may not be included in the loan.) Forms and instructions are available online in PDF at The maximum loan amount is $30,000. The maximum loan term is 15 years. The interest rate is the Taxable Program or Rural Owner-Occupied 15-year interest rate, plus.375. Alaska USA Federal Credit Union Real Estate Telephone Loan Center (RETLC) P.O. Box Anchorage, Alaska or toll free

19 Second Mortgage Program Taxable & Rural Owner- Occupied Borrowers may obtain a second mortgage under the Taxable or Rural Owner-Occupied Loan Programs. Borrowers may use loan funds to finance home improvements or purchase a home in conjunction with an assumption of an existing AHFC loan and make repairs if need be. Type II mobile home properties are not eligible. The maximum loan amount with a new appraisal is $312,750. The maximum loan amount with an alternate valuation is $100,000. The maximum loan term is 15 years. Individual program guidelines apply. Loan Options: Energy Efficiency Interest Rate Reduction. Contact an AHFC-approved lender (see page 32). Purchase Renovation Renovations must improve the living conditions of the home. Luxury items (sauna, Jacuzzi, etc.) may be included if they are an incidental portion of the total renovation costs. Maximum loan amount is based on the type of financing plus renovation cost. Maximum time to complete renovations is 180 days from the date of closing. Maximum Loan Amount: Conventional Based on 95% of the purchase price plus 100% of the renovation cost NOT to exceed 95% of the as complete appraised value. VA Based on 100% of the purchase price plus 100% of the renovation cost NOT to exceed 100% of the as complete appraised value. FHA, HUD & USDA-RD Follow appropriate guidelines. Energy improvements can be included. New construction additions may be subject to BEES inspections and/or all mandatory inspections. Example Conventional Loan: Purchase Price $225,000 Value Before Repairs $225,000 Value After Repairs $260,000 Maximum Loan Cannot Exceed Repairs Kitchen Renovation $20,000 Carpet Replacement $7,500 Total Repairs $27,500 $247,000 (Based on 95% of appraised value.) Loan Amount 95% Price ($213,750) + 100% Repairs ($27,500) 16

20 Final Loan Amount $241,250 SINGLE- FAMILY LOAN PROGRAMS RURAL (One- to Four-Family Properties in Rural Areas) Rural Loan Programs are available in small communities. A small community is defined as a community with a population of 6,500 or less that is not connected by road or rail to Anchorage or Fairbanks, or a population of 1,600 or less that is connected by road or rail to Anchorage or Fairbanks and at least 50 statute miles outside of Anchorage or 25 statute miles outside of Fairbanks. In this definition, connected by road does not include a connection by the Alaska Marine Highway System or roads outside the boundary of the state of Alaska. Rural programs include the Rural Owner-Occupied, Rural Non-Owner-Occupied and Rural Small Building Material Loans. The Refinance and Streamline Refinance Options, as well as the Second Mortgage Programs previously described in this handout are also available. A brief description of each of the rural programs follows. Rural Owner- Occupied Loan Program Owner-occupied properties located in small communities are eligible. Commercial use is only allowed on single-family homes and is limited to 25% of the gross floor area. No commercial use is allowed on duplex, triplex or fourplex properties. The Rural Program interest rate applies to the first $250,000 of the loan amount. Loans over $250,000 receive a blended interest rate; the excess over $250,000 is calculated at the Rural Program rate plus 1%. Mortgage insurance is required if the down payment is less than 10%. Loan Options: Affordable Housing Enhanced Loan Program. Energy Efficiency Interest Rate Reduction. Interest Rate Reduction for Low-Income Borrowers. State Veterans Preference. Refinance. Streamline Refinance. Contact an AHFC-approved lender (see page 32). Rural Non- Owner- Occupied Loan Program Borrowers may be Alaska residents, businesses, local government entities or regional education attendance areas. Properties must be located in small communities and are limited to duplexes, triplexes or fourplexes. Commercial use is not allowed. The Rural Program interest rate applies to the first $250,000 of the loan amount. Loans over $250,000 receive a blended interest rate; the excess over $250,000 will be calculated at the Rural Program rate plus 1%. 17

21 Housing units do not have to be attached, except when financed through the HUD184 Program. All units must have a minimum of 600 square feet. Properties with non-conforming features are not eligible. The project must be self-supporting with a break-even point of 85% or less and a minimum debt service coverage ratio of 1.15%. Loan Options: Energy Efficiency Interest Rate Reduction. Refinance. Contact an AHFC-approved lender (see page 32). Rural Small Building Material Loan Borrowers with residential property located in small communities may apply for funds to renovate or complete their property. The project may include repairs or renovations that improve the livability of the home, energy-efficient upgrades or the addition of living space. The maximum loan amount is $100,000. Loan funds may be used to purchase building materials (exclusive of luxury items such as hot tubs), pay for freight or third-party labor costs. Borrowers must complete renovations within six months (180 days) of loan closing. Forms and instructions are available online in PDF at On non-owner-occupied properties, only duplexes and above are eligible. Construction/renovation must meet current building codes. Health/safety hazards must be included in the renovation. Loan Options: Energy Efficiency Interest Rate Reduction. Alaska USA Federal Credit Union Real Estate Telephone Loan Center (RETLC) P.O. Box Anchorage, Alaska or toll free

22 LOAN OPTIONS Use AHFC loan options in combination with Single-Family Loan Programs to reduce your interest rate or assist with the down payment. Interest Rate Reduction for Low-Income Borrowers, IRRLIB. Energy Efficiency Interest Rate Reduction, EEIRR. Affordable Housing Enhanced Loan Program, AHELP. State Veterans Interest Rate Preference, State Vet. Refinance The Refinance Option allows applicants to obtain new financing to improve the terms on their existing loan and/or finance renovations or home improvements. (Existing AHFC, FHA insured and VA/USDA-RD guaranteed loans are typically eligible under the Streamline Refinance Program.) Single-family residences, duplexes, triplexes, fourplexes, condominium units, Common Interest Community units and Type I manufactured homes. Type II manufactured homes only if currently financed by AHFC. The maximum loan amount is the current unpaid principal balance (including up to 30 days of unpaid interest on the existing loans) and may be increased by new loan closing costs and first year MIP premium, if applicable, not to exceed current AHFC, FHA, VA, USDA-RD and Second Mortgage program limits as applicable. The borrower may not receive cash back other than for reimbursement of prepaid closing costs. The borrower must occupy the property, unless the loan being refinanced is a Rural Non-Owner- Occupied Program loan. The loan being refinanced must be current at closing. Current means paid to within 45 days of the closing date. Contact an AHFC-approved lender (see page 32). Streamline Refinance The Streamline Refinance Option allows applicants to obtain new financing secured by property that is currently financed by AHFC without the requirement for an appraisal and credit search. The loan may be conventional, FHA, HUD, VA or USDA-RD, provided all applicable insurer/guarantor criteria are met. The original loan must have been made to an owner-occupant and may have been a first lien or second lien. Borrowers must have an existing AHFC mortgage loan. Single-family residences, duplexes, triplexes, fourplexes, condominium units, Common Interest Community units and Type I or Type II manufactured homes. Current project approval is not required. Maximum loan amount is limited to the current unpaid principal balance plus up to 30 days of unpaid interest on the existing loan and up to $5,000 for closing costs. The VA funding fee or FHA up-front MIP may be added to the loan in addition to the $5,000 maximum allowable closing costs. 19